I. In its several dispositions, e.g., Gong-Chu-Zi No. 110067 (dated September 30, 2021), the Taiwan Fair Trade Commission (“TFTC”) decided that a business’ claims that the products “have been certified by impartial institutions” and “are not harmful to humans” through wielding relevant test reports were in violation of the provisions on false advertising. The TFTC also decided the advertisers disseminating the false advertisement include the product supplier and the online shopping platforms.

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II. Facts:
The seller was selling products related to “ARC-FLASH photocatalyst” on online shopping platforms including momo.com, PChome24H, YAHOO Shopping Mall, etc., claiming that “ARC-FLASH photocatalyst” has been certified by impartial institutions including the Bureau of Standards, Metrology & Inspection of the Ministry of Economic Affairs, the Industrial Technology Research Institute (“ITRI”), the National Chung-Shan Institute of Science and Technology (“NCSIST”), and the Food Industry Research and Development Institute, … SGS … etc.,” “The product has obtained the following certifications and is harmless to humans. Please feel free to use it… have been certified by ITRI, NCSIST, SGS…,” “ARC-FLASH photocatalyst has obtained the following certifications: having been certified by ITRI, NCSIST, SGS...” Such advertisement has been determined by the TFTC to be a false advertisement, violating Paragraph 1 of Article 21 of the Fair Trade Act, and the seller is ordered to cease such wrongdoing pursuant to Article 42 of the same in addition to a fine of NT$1 million.

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III. Rationale:
1.  As to the advertisement’s claim of “having been certified”:
The TFTC inquired of each institution about the seller’s claim of having been certified by these institutions, discovering that the sample sent by the seller for testing was not “ARC-FLASH photocatalyst-related product,” and for some of the tests such as photocatalyst air purification efficiency test (nitrogen oxide) and waste gas treatment capacity, the reports were simply presentations of test data and nothing to do with “whether the product passed a test.”
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2. As to the advertisement’s claim of “being harmless to humans”:
The TFTC inquired of testing institutions such as the ITRI, NCSIST, and SGS about their professional opinions, finding that the test reports provided by the seller did not involve any determination regarding whether the product is harmful to humans and the testing of a few harmful substances was not sufficient to determine if the product was harmful to humans.
In summary, the TFTC decided that the seller’s advertisements representing the certification by impartial institutions affected the consumers’ trust in the quality of the products. The difference between the presentations of advertisements and the reality was apparently to cause consumers in danger of having wrong understanding or making wrong decisions, which pertained to false or misleading representations that are sufficient to influence trading decisions, violating Paragraph 1 of Article 21 of the Fair Trade Act regarding false advertisement.

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IV. Analysis:
1. The samples that a seller submits for certification should be the same as the product for sale in order to present test result data on the advertisement.
2. If the seller’s advertisement is only a representation of objective test data of the product, the seller should avoid using languages, e.g., “the product has been certified,” that allude to a testing agency’s certification of a product’s quality
3. A seller’s advertisement should avoid making conclusions that exceed the functions of the test reports, e.g., “the product is harmless to humans,” in order to avoid misleading consumers into making wrong trading decisions.

(Author: Jin-Hong Tsai, Intern Attorney)

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